AOL-Netscape Merger Does Not Affect US Antitrust Case Against Microsoft

Strategic Insights -

The AOL-Netscape merger has resumed its US government antitrust case against Microsoft, with MIT economics professor Franklin Fisher testifying that the deal does not affect the case. Fisher argues that since the merged company, AOL, won't compete with Microsoft in the PC operating systems market or browsers, the merger is irrelevant to the case. He also maintains that AOL bought Netscape for its portal business, not its browser technology, and that Netscape was acquired for a reasonable price.

Key Takeaways:

  • The AOL-Netscape merger does not affect the US government's antitrust case against Microsoft, according to MIT economics professor Franklin Fisher.
  • The merged company, AOL, will not compete with Microsoft in the PC operating systems market or browsers.
  • Fisher believes AOL bought Netscape for its portal business, not its browser technology.
  • Netscape was acquired for a reasonable price, compared to other similar mergers such as Yahoo's purchase of GeoCities and @Home's acquisition of Excite.
  • Fisher thinks it's too late for AOL to change its mind and push Netscape's browser technology after Microsoft has won the browser war.
  • The AOL-Netscape deal does not threaten Microsoft's operating systems monopoly in any way.

Statistics:

  • The AOL-Netscape merger was announced [no specific date mentioned].
  • The license agreement between AOL and Microsoft for Internet Explorer was renewed for a further two years in January 1999.
  • Netscape's browser technology is no longer a threat to Windows as a software platform.
  • The probability of AOL changing its mind and pushing Netscape's browser technology is assessed as "very, very unlikely" by Franklin Fisher.

Sources:

  • [1] Rachel Chalmers, "Fisher Testifies that AOL-Netscape Deal Won't Hurt Microsoft" (Exact publication date not provided) #